Q2 2024 Tenaris SA Earnings Call Transcript
Key Points
- Tenaris SA (TS) reported strong free cash flow of $774 million for the second quarter.
- The company maintained a robust net cash position of $3.8 billion at the end of the quarter.
- Tenaris SA (TS) renewed its long-term contract for shale operations in the Gulf of Mexico and secured new contracts with ExxonMobil and Woodside.
- The company is making significant investments in technology and infrastructure, including a new electric arc furnace in Argentina and a second wind farm.
- Despite market challenges, Tenaris SA (TS) has a positive outlook on future demand, particularly in offshore projects and the Middle East.
- Second-quarter sales were down 18% year-on-year and 3% sequentially, primarily due to lower volumes and average selling prices.
- EBITDA for the quarter decreased by 34% sequentially to $650 million, impacted by lower selling prices and an extraordinary provision for ongoing litigation.
- The company expects sales volumes to be 10% to 15% lower in the second half of the year compared to the first half.
- High levels of OCTG imports, particularly from Asian countries, are affecting pipe prices and causing damage to the domestic industry in the United States.
- Uncertainties in Mexico's energy policy and Argentina's macroeconomic environment are limiting drilling investments, affecting sales in these regions.
Good day and thank you for standing by. Welcome to quarter two 2024 Tenaris SA earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Giovanni Sardagna. Please go ahead.
Thank you, Gigi, and welcome to Tenaris 2024 second quarter conference call. Before we start, I would like to remind you that we will be discussing forward-looking information in the call and that our actual results may vary from those expressed or implied during this call.
With me on the call today are Paolo Rocca, our Chairman & CEO; Alicia Mondolo, our Chief Financial Officer; Gabriel Podskubka, our Chief Operating Officer; and Luca Zanotti, President of our US Operations. I would like to start by mentioning that we will host an Investor Presentation in London on September 24, and we hope to see many of you there.
Before passing over the call to Paolo for his opening remarks, I would like to briefly
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